Harvard Business review

Does Your Project Have a Purpose?

In January 1957 a jury of four renowned architects unanimously selected Jørn Utzon’s proposal as the winner of an international design competition. They lauded the Danish architect’s proposal for a large-scale performance space as the “most original and creative solution” among the 230 proposals received from over 30 countries. The project had a very positive business case and was greenlighted. The estimated budget was $8 million and it would take four years to be constructed.

However, the initial deadline soon proved inadequate. A lack of definition and details in Utzon’s proposal made it unfeasible to for engineers to start phase 1 in early 1959 as expected. The complexity of the design significantly increased construction costs. Project deadlines were missed, the budget kept rising, and the work remaining on the project seemed to be increasing over time rather than decreasing.

In the end, the project was delayed a decade — it took 14 years to complete — and it exceeded its budget by 1,300%. The state lottery paid for much of the $95 million cost overrun, diverting money from other public expenditures.

From a project management perspective, shouldn’t this project have been scaled back or stopped after so many delays and budget overruns? From an initial business case perspective, it was a complete disaster, right?

In fact, this project is the Sydney Opera House, a symbol of the city and Australia, and one of the most recognizable architectural works worldwide. Clearly, meeting the budget, schedule, and business case are not the only measures of a successful project.

The Sydney Opera House is not the only case like this; the UK’s Millennium Dome project and even the Channel Tunnel are well-known projects that had completely flawed business cases yet realized benefits that were never anticipated by those who originally conceived them. Over time, all these projects have become extremely successful.

When evaluating and prioritizing projects, looking at the business case is a good starting point, but it’s not enough. We also need to understand how the project connects to a higher purpose. Few organizations spend enough time articulating the why of their projects — and many don’t even know how to — but it is simple to learn and an essential for selecting and prioritizing the best projects possible.

Why Business Case Alone Isn’t Enough

All project management methodologies demand that projects have a well-defined business case. The thinking process, research, and analysis of options that go into constructing one are essential in developing a good understanding of the project and whether it is worth investing in. Unfortunately, when we are constructing a business case, even fundamentals such as cost or scheduling estimates are subject to the biases of whoever is formulating them. It goes against human nature to bring forward a failing business case. If someone wants a project done badly enough, one way or another they will find a way to make the business case clear their organization’s hurdles, and they will usually present their figures in the most positive light possible.

In a study on project success that I carried out while working with PricewaterhouseCoopers, we reviewed 10,640 projects from 200 companies in 30 countries and across various industries. We found that only 2.5% of the companies successfully completed 100% of their projects, and on many occasions, business cases were overly optimistic and based on wrong assumptions.

Purpose Drives Engagement and Higher Performance

So, if looking at business case alone is not enough, why is understanding projects for their purpose so important? To begin with, it can help leaders decide whether the project makes sense strategically. Not every proposal with a positive business case can be undertaken, and understanding a project’s purpose helps us see into its alignment with strategic goals. But perhaps more important for project success, purpose is a key driver for engaging team members and the organization as a whole and motivating them to support the project.

Many projects have lengthy, technical, or deliverable-focused goals: a new software rollout, a new platform, an expansion program, a new set of company values, a reorganization, or a digital transformation project. Others use financial goals such as a 10% return on investment (ROI). Beware of overly complex goals and numerical targets such as these; they consistently fail to rally passionate commitment in a project.

Instead, weave purpose into the project’s foundation. An effective purpose reflects the importance people attach to the project’s work and reveals its fundamental reason for being. It awakens their intrinsic motivations and gets at the deeper why of the project beyond just making money.

Purpose-driven companies are 2.5 times better at driving innovation and transformation than are other companies, according to the EY Beacon Institute, while Deloitte says that on average, they generate 30% more revenue from innovations launched in the last year. These statistics are borne out in my experience as an executive: projects with a higher purpose have significantly higher chances to be successful than ones that don’t inspire people. People have enormous strengths, and the best leaders know that the way to tap into these strengths is through their hearts — not through deliverables or ROI. When a project they work on connects to their inner purpose and passions, they can achieve extraordinary things. Conversely, lack of purpose or conviction about a project can quickly spread from one team member to the rest of the team.

Yet few organizations know how to articulate, or spend enough time articulating a project’s purpose, its connection with the organization’s strategy, and, ultimately, why anyone should care.

Keep Asking “Why”

One method of finding the purpose of a project is to simply ask, “Why are we doing the project?” When you’ve arrived at your answer, ask why again. Usually, leaders need to ask this question four to seven times to get to the essence of the matter.

Consider a project to implement a new HR system. Ask most project managers what the purpose of this project would be and they’ll say, “We’re implementing a new HR system.” If they do, they’ve confused a deliverable with a purpose. A deliverable tells us what the project produces — not why we are producing it.

Instead, start asking why. “Why are we implementing a new HR system?” The answer may be, “To provide better services to our employees.” You have just gone to a higher level. Ask again, “Why do we want to provide betters services to our employees?” Perhaps, “To address our key issue of poor employee engagement.” And again, “Why do we want to increase employee engagement?” “Because we want our employees to be happy at work, which will lead to a higher performance of our business.”

With this sequence of deeper and deeper questioning, you have now discovered that the purpose of your project is not a new HR system — it is to make your employees happier and to improve your overall performance.

What a difference. Now you have a project whose purpose connects with the organization’s strategy and will motivate project team members. Once you have uncovered the purpose, you’re ready to ask two more questions: “by when?” and “how much?” Your answer might be, we will increase the motivation of our employees by 30% on our next survey, in six months. You will now have a compelling project purpose, specific, measurable, and with a clear deadline, which will help you engage the team and stakeholders much more effectively, leading to a more successful project.

If after this exercise you don’t reach something relevant — something that will motivate people to work on it — then you probably should not start the project.

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Let’s take a last look at the Sydney Opera House. In 1954, three years before the selection of Utzon’s design, New South Wales Premier Joseph Cahill kicked off the project with a stunning purpose: “help mould a better and more enlightened community.” Throughout delays and challenges, the purpose held steady. The opera house was officially inaugurated by Queen Elizabeth II on October 20th, 1973 and has become one of the most visited arts and entertainment centers globally, with nearly 11 million visitors per year. According to Deloitte, the Sydney Opera House is estimated to be worth $4.6 billion to Australia. Developing a business case is an arduous and necessary process, yet what really makes a project compelling, and drives people to do their greatest work, is a higher purpose.

This article is adapted from the HBR Project Management Handbook.

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